The housing market has commenced the new year with a surge following a remarkable increase in prices. According to property website Rightmove, the average home price has risen by nearly £9,900 to £368,031 since December. This 2.8% jump represents the largest January increase in Rightmove’s 25-year history and the most significant month-on-month rise since June 2015.
Rightmove attributed this market rebound to Chancellor Rachel Reeves’ Budget in late November, which dispelled previous rumors and uncertainties that had subdued market activity. Despite the positive trend, Rightmove cautioned potential sellers about the challenging market conditions. The number of homes available for sale is at its highest level for this time of year since 2014, with a third of listed properties experiencing price reductions. Market conditions vary widely across different regions, with notable price declines observed in the East Midlands and Scotland.
Buyer interest surged in the two weeks post-Christmas, with a 57% increase in inquiries to agents and an 81% rise in newly listed properties compared to the preceding period. This heightened demand has been supported by declining mortgage rates, as major lenders announced significant rate reductions at the end of 2025 and the beginning of this year.
Colleen Babcock, a property expert at Rightmove, noted that the current seller confidence is a positive development, but cautioned sellers to heed their agent’s advice when setting prices. With a surplus of homes for sale and many properties seeing price reductions, sellers are advised to be realistic in their pricing strategies to attract buyers.
Myles Moloney, director at Chase Buchanan estate agents in London, expressed optimism about the bustling market, highlighting the appeal of homes meeting current buyer preferences. Demand for family-friendly homes with spacious kitchen and living areas has notably increased, with well-presented, sensibly priced properties garnering significant attention. Buyers are keen to secure their next home early in the year, driven by improved affordability due to mortgage rate cuts and the appeal of modern family-oriented properties.